A closer look at Royal Caribbean's acquisition of Silversea

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Back in the mists of time, last century, when the modern cruise industry was in its infancy, acquisition was commonplace.

The ultimate outcome was domination by three major players - Carnival, Royal Caribbean and NCLH (not forgetting of course the huge importance of MSC on the other side of the Atlantic) - all of which operate multi-brand fleets in the mainstream and premium markets, each with a different marketing focus. Whilst NCLH and Carnival each have a luxury brand within the portfolio (Regent Seven Seas Cruises and Seabourn respectively), Royal Caribbean's slightly quirky Azamara and Celebrity haven't quite filled the luxury slot.

Silversea's Silver Wind in Venice

The trick with acquisition is to recognise the value of what you have bought, make improvements and cost savings where you can, but not interfere with the essence of the brand itself. Whilst hardcore fans might disagree, feeling that the needs of the shareholders are set above those of the guests, we have seen the mega cruise lines achieve this quite successfully in the past. The theory is that whilst some guests will stay loyal to the brand they love, others can be led through the journey, from family holidays with small children, to more adventurous or more exclusive experiences.

In a jointly prepared statement, the two companies pointed to four key benefits of the acquisition: driving long-term capacity growth in the burgeoning luxury and expedition segments; diversifying Royal Caribbean's portfolio and increasing its expedition offerings; increasing vacation and destination options for the guests of both companies; and realising significant synergies related to global market access, supply chain, purchasing power and other economies of scale.

Outdoor seating on Silver Spirit

It is that last point that should be a comfort to Silversea regulars - with less money required to purchase basics (such as fuel) and service the debt, more can be invested in the ships themselves, and their onboard delivery. We are certainly optimistic about their refurbishment programme, following the recent 'stretching' of Silver Spirit.

This re-fit has made Silver Spirit look more like her younger sister Silver Muse, with 35 more suites, a larger pool deck, a bigger spa and fitness centre, additional restaurants (making a total of eight), and most of the ship's décor overhauled. With new ships Silver Moon and Silver Dawn in the pipeline, and rumours of a new expedition ship, there is plenty for fans of Silversea to be excited about.

Edwina Lonsdale
Meet the author

Edwina Lonsdale is Managing Director and, together with husband Matthew, owner of Mundy Cruising.

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